Clarification on Transferring Azure Reservations During Tenant Change

Question

Hi
We are planning to move our Azure subscription to a different tenant and would like to understand the impact on our existing reservations.

Could you please clarify the following:

Will our existing Azure VM reservations automatically move when the subscription is transferred to another tenant?

If not, what is the recommended approach to retain the reservation benefits after the tenant change?

Answer 1

Hello Cheedella, Satyanarayana

Thank you for posting your query on Microsoft Q&A platform.

When you transfer an Azure subscription to a different Microsoft Entra tenant, Azure Reservations do not automatically move with the subscription.

Azure Reservations are not tied to the subscription itself. Instead, they are associated with:

• A Reservation Order, and
• The Microsoft Entra tenant (directory) where the reservation was purchased.

As a result, after a tenant change, the reservation remains in the original tenant and will not apply to resources in the new tenant unless additional action is taken.

To retain your reservation benefits, Microsoft supports changing the reservation’s directory (tenant) separately from the subscription transfer.

Please have a look into below supported or recommended approach to retain the reservation benefits after the tenant change:

1. Change the reservation order’s directory to the target tenant.

• You can transfer a reservation order and all its dependent reservations to another tenant.
• This action does not require cancellation or re‑purchase of the reservation.
• Billing ownership remains unchanged.
• After the move, RBAC permissions are removed, and must be re‑assigned in the new tenant.
• Once transferred, you must update the reservation scope so it applies to subscriptions in the new tenant (shared or single‑subscription scope).

This is the officially supported method to continue using existing reservation benefits after a tenant change.

Subscription transfer alone is not sufficient to move reservations. Reservation transfer is a manual, explicit action. After the directory change Re‑assign reservation owners. Verify and update the reservation scope so benefits apply correctly.

No service downtime or resource redeployment is involved.

You can refer below document for more details:

https://learn.microsoft.com/en-us/azure/cost-management-billing/reservations/troubleshoot-reservation-transfers-between-tenants

Azure reservations do not automatically move with a subscription tenant transfer. To retain reservation benefits, the reservation order must be explicitly moved to the target tenant and re‑scoped accordingly. This is the supported approach documented by Microsoft.

Kindly let us know if the solution provided helpful for you.

If you need any further assistance, please feel free to reach out.

Thanks,
Suchitra.

Answer 2

Azure VM reservations do not automatically move when a subscription is transferred to another Microsoft Entra tenant.

Key points and recommended approach:

1. Subscription transfer vs. reservation transfer
   • Transferring an Azure subscription to a different tenant does not transfer the associated reservations by default. The product transfer behavior depends on the billing agreement types involved.
   • For many agreement combinations, reservations and savings plans don’t automatically transfer and may not be supported for transfer at all. For example, CSP → MCA-online explicitly doesn’t support reservation transfer and requires moving resources separately.
   • When only billing ownership of a subscription changes within the same tenant, resources and running services are not affected, but reservations still follow their own transfer rules.
2. Effect on reservation scope after directory/tenant change
   • When the directory of a reserved instance is changed, the reservation keeps pointing to the old/source tenant scope by default.
   • Example from the documentation:
     • Current scope: Single subscription A1 in Tenant A.
     • After changing the reservation directory to Tenant B, the reservation (now in Tenant B) still points to subscription A1 in Tenant A.
     • Until the scope is manually updated, the reservation benefit continues to apply to subscription A1 in Tenant A.
3. How to retain reservation benefits after tenant change The exact steps depend on your agreement type and what is supported: a. Check if reservation transfer is supported for your agreement types
   • Use the product transfer matrix to see if reservations can be transferred between your current and future agreement types. For example:
     • MOSP (pay-as-you-go) → MCA-online or MCA-E: self-service reservation transfers are supported.
     • MOSP (pay-as-you-go) → EA: reservations may require a billing support ticket.
     • CSP (MCA managed by partner) → MCA-online: reservations and savings plans don’t automatically transfer and transferring them isn’t supported.
   b. If reservation transfer is supported
   • Use the documented transfer process (self-service or via billing support ticket) to move the reservations to the destination billing account/tenant.
   • After the reservation is in the new tenant, update the reservation scope so benefits apply to the new subscriptions:
     • Set scope to Shared or Management group covering the new subscriptions, or
     • Set scope to Single and select the specific destination subscription(s).
   • Until the scope is updated, the reservation may still be logically associated with the old subscription and not apply benefits where expected.
   c. If reservation transfer is not supported
   • Reservations cannot be moved with the subscription. In that case, the practical options are:
     • Keep the original tenant/subscription using the reservations until they expire, or
     • Use the exchange process (where allowed) to repurchase reservations under the correct billing subscription/tenant, then update scope appropriately.
4. After the tenant change – mandatory scope update
   • Documentation explicitly states that after changing the reservation directory, the scope must be manually updated to point benefits to resources in the destination tenant.
   • If the reservation was at shared scope and the new subscriptions are under the same billing profile/enrollment, they may already receive the benefit without scope change; if it was at management group or single subscription scope, the scope must be changed to target the new subscriptions/management group.

In summary:

• Existing VM reservations do not automatically follow a subscription when it is moved to another tenant.
• To retain benefits, reservations must be transferred according to the supported product-transfer rules for your agreement types, and after the directory change, the reservation scope must be manually updated to target subscriptions in the new tenant.

---

References:

• Azure product transfer hub
• Product transfer support
• Change an Azure reservation directory between tenants
• Manage Reservations for Azure resources
• Transfer a customer's Azure subscriptions or reservations, or savings plans (under an Azure plan) to a different CSP
• Transfer Azure Enterprise enrollment accounts and subscriptions